Chrysler's car dealership network is on the verge of collapse, a US bankruptcy court heard on Monday, as hundreds of dealerships have closed their doors this year and uncertainty about the company's future is driving consumers away.

"A lot of these guys right now are just trying to survive," James Arrigo, co-chairman of Chrysler's National Dealer Counsel said of the dealers at a hearing yesterday in US bankruptcy court in Manhattan.

Arrigo, one of the company's top selling dealers, according to court papers, says that even he has seen a drop off of about 50 percent in car sales this year.